Copyright© 1999 by School Services of California, Inc.
Utility/Capital Facility Fees Legislation on Governor's
Desk
AB 1657 (introduced by Committee on Utilities and Commerce) - one of two pieces of legislation that could substantially alter or increase the amount of fees community colleges pay to public utility agencies - made it to the Governor's desk. The other piece of legislation, SB 1132, was held in the Assembly Judiciary Committee and will become a "two-year bill."
SB 1132, pertaining to capital facility fees, raised a great deal of concern among public educational entities because it revises the limitation on capital facility fees imposed by a public utility agency on school entities and state agencies. (See the June 25, 1999 Update article "Capital Facility Fees May Increase for Community Colleges," page 101).
Existing law provides that a public utility agency may impose capital facility fees on any school district, county office of education, community college district, the California State University, the University of California, or state agency, where necessary to defray the actual construction costs of that portion of the public utility facility actually serving the public agency. After July 21, 1986, the imposition of new fees or increase of existing fees may be imposed only after the parties through negotiations have reached agreement.
AB 1657 requires the public utility to notify by mail the affected public agency (community college district, etc.) no less than 30 days before the public hearing set to adopt an ordinance, resolution or motion enacting or changing a capital facilities fee, specifying the proposed action (impose or increase a capital facility fee in excess of that allowable under the Implicit Price Deflator for State and Local Government purchases).
Also, the bill imposes the same 120 day limitation on a judicial proceeding to seek reimbursement for paid capital facility fees or to challenge an increase in electric utility rates charged by an electric municipal utility.
The California Municipal Utilities Association believes that AB 1657 would establish a reasonable period beyond which a local publicly owned utility would not face exposure to lawsuits attempting to claim refunds or challenge the validity of the rates and charges. At the same time, public education and local state agencies would have, according to the proponents, sufficient time and process to be aware of any proposed rate increases.
-- Arnold Bray